By Hiroshi Suzuki
Sept. 19 (Bloomberg) -- One of Japan's opportunities to tap cleaner, cheaper energy and reduce dependence on imported oil has run into a problem: millions of naked bathers.
The dispute is over deep-underground volcanically heated water that geothermal power plants would tap to generate electricity. Japan, with nearly a tenth of the world's active volcanoes, also has thousands of hot spring resorts whose owners oppose plans to siphon off steaming mineral waters.
``Developers say geothermal plants don't affect hot springs, but if something goes wrong, it's our responsibility to prove cause and effect,'' said Toyoshiro Kawazu, managing director of Hizenya Hotel Group, whose family owns a 300-year-old spa on Kyushu, the southernmost of Japan's four main islands.
While geothermal power projects may help cut the country's $183-billion bill for imported fuel, owners of Japan's 7,700 spa resorts say baths could dry up, damaging an industry that attracted 137 million bathers last year. No spas have reported damage from geothermal plants, though owners say that's because it's difficult to prove and reporting problems may drive away customers.
``We can't dig down 1,000 meters to prove they're at fault,'' said Kawazu.
Kawazu won a five-year battle in 2002 with one of Japan's largest power companies, Electric Power Development Co. The company withdrew plans for a geothermal plant on Kyushu after Kawazu and local residents refused to sell land for the 17 billion yen ($159 million) project.
Volcanic Power
With oil prices rising more than 60 percent in the last 12 months through July and concerns over greenhouse gases rising, power companies are reluctant to give up on geothermal energy.
Resource-poor Japan imports 99 percent of its oil. Oil- powered plants produce 742 grams of carbon dioxide per kilowatt hour of energy, compared with just 15 grams for geothermal.
``Geothermal energy is abundant in our volcanic country and can produce power with less greenhouse gas emissions,'' said Nobuyoshi Soma, chairman of the Japan Mining Industry Association, which wants government help to develop geothermal plants.
Geothermal is cheaper, as well. It costs more than 20 yen (18 cents) to produce one kilowatt of power from oil-fired plants, compared with 8.3 yen for geothermal, according to the latest available figures from Japan's New Energy and Industrial Technology Development Organization.
Japan has 19 geothermal power plants, mostly in northern and southern regions, where most of the spa, or onsen, resorts are concentrated. The Tohoku region in northern Japan has more than 1,000 hot springs, while Kyushu boasts another 1,800.
The Japan association of spa resorts said it doesn't keep records of total sales in the industry.
Energy Potential
Japan has the potential to produce 20,540 megawatts of geothermal power, or about 7.5 percent of Japan's total energy use, according to the Central Research Institute of Electric Power Industry. That would make the country the world's largest producer of geothermal energy after Indonesia and the United States, said Japan's National Institute of Advanced Industrial Science and Technology.
So far, Japan's total geothermal power production of 530 megawatts is negligible -- just 0.1 percent of the country's total power output, according to the latest available statistics.
Most geothermal plants in Japan are small. The largest, in Oita prefecture, run by Kyushu Electric Power Co., generates 110 megawatts or enough to supply daily power to just 36,000 homes.
``Right now, all we can do is try to convince local residents in our efforts to set up mini-geothermal power equipment,'' said Tatsuo Yamakawa, deputy general manager of Kyushu Electric's corporate planning department.
Overseas Option
Meanwhile, Japanese companies are looking overseas. Itochu Corp., Japan's fourth-largest trading company, is teaming up with PT Medco Energi Internasional, and U.S. turbine manufacturer Ormat Industries Ltd. on a $600-million contract to build and operate a 340-megawatt geothermal plant in Surulla, Indonesia.
Kyushu Electric Power Co., Japan's fifth-largest utility, bought a 25 percent stake in the Surulla project in November.
Hot springs are popular in Japan as both a source of relaxation and for their supposed curative powers. One of Japan's oldest onsen, Dogo Spa, in Shikoku, has been in use for 3,000 years, according to the local hotel association.
Japanese plan entire vacations around onsen -- spending hours a day soaking in enclosed or open-air springs with family or friends.
``Bathing in a hot spring is one type of medical treatment from the old ages,'' said Joji Noda, the president of Ibusuki Phoenix Hotel, located at southern tip of Kyushu. ``There is no safety net if a spa near a geothermal power plant dries up.''
Local Industry
Local governments face a quandary. Ibusuki town, for example, wants to promote the use of carbon-free energy, while protecting local hot springs, the major source of income in the town of 45,000 people.
``Hot springs are the base we stand on,'' said Shigeo Takano, manager of the city's planning department. ``We would consider using geothermal energy if we could be sure it would not affect our hot springs.''
To contact the reporter on this story: Hiroshi Suzuki in Tokyo at Hsuzuki5@bloomberg.net.
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